When running for governor in 1966, Ronald Reagan famously coined his party’s 11th Commandment: “Thou shalt not speak ill of any fellow Republican.”
It seems some New York City real estate brokers are taking a page from that playbook in order to counteract what they see as doom-and-gloom coverage of the current downturn. Some brokers say they are proactively trying to unspin what they view as negative media coverage in order to calm jittery buyers and sellers.
“We don’t want to contribute to any fear-mongering that’s out there,” says Stacey Max, who manages Bellmarc Realty’s Downtown office. “And sometimes the media does spin the situation to sell newspapers.”
James Lansill of the Corcoran Sunshine Marketing Group says that in the coverage of the current climate, analysts tend to lump together homes with subprime mortgages and pedigreed co-ops as if they were all part of the same market.
“Some aren’t making the distinction between the well-located and the marginally located,” he says.
Citi Habitats president Gary Malin says the coverage of the crisis indicates the housing woes will be long-lasting, which, in turn, is keeping some buyers stuck on the sidelines. But if changes in Federal Reserve policy suddenly result in 30-year fixed mortgages with 4.5 percent interest rates (about one point below their current levels), then a scramble for homes could ensue, he says. He says it’s best to be ready to make a move.
Brokers acknowledge that striking the right tone could impact their own business. Tamir Shemesh, a top broker with Prudential Douglas Elliman, notes,”If you read in the papers that somebody has done nothing, why would the client come to you?”
New York’s real estate industry has for years seemed to abide by the self-protecting maxim that even when the market is down brokers are supposed to wax bullish. And some firms have gone as far as to discipline brokers when they publicly say something that feeds into the negative coverage of the market.
In September Hall Willkie, president of Brown Harris Stevens, publicly slammed powerbroker Kathy Sloane for telling ABC’s “20/20” that high-end co-ops had lost 25 percent of their value. Willkie said Sloane’s comments were “completely speculative, and at times factually incorrect.”
And, Brown Harris Stevens is not alone in trying to keep employees from spouting negative remarks. A broker at one of the nation’s largest residential firms, who preferred not to be identified, told The Real Deal, “Brokerages and their senior management want to continue to send the message that all is going to be fine, and as soon as someone says otherwise then they hammer that person for not toeing the company line.”
But Jacqueline Urgo, president of the Marketing Directors, says acknowledging the changed market is a given. “This is a sophisticated, intelligent audience,” she says. “To say nothing has changed is not credible.”